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Krugman on ‘Sequester of Fools’

February 23rd, 2013 | Mike Hall

Image: Mike HallPaul Krugman has a pretty straightforward plan to deal with the sequester that’s due to hit March 1. The New York Times columnist and Nobel Prize-winning economist says, “The right policy would be to forget about the whole thing.”

He bases his proposal on what Federal Reserve Vice Chair Janet Yellen said in her keynote address to the Trans-Atlantic Agenda for Shared Prosperity conference at the AFL-CIO headquarters in Washington, D.C., earlier this month. Fiscal austerity, such as the sequester and the latest doomsday alert from the Bowles-Simpson duo, is the enemy of real economic recovery. Writes Krugman:

America doesn’t face a deficit crisis, nor will it face such a crisis anytime soon. Meanwhile, we have a weak economy that is recovering far too slowly from the recession that began in 2007. And, as Janet Yellen, the vice chairwoman of the Federal Reserve, recently emphasized, one main reason for the sluggish recovery is that government spending has been far weaker in this business cycle than in the past. We should be spending more, not less, until we’re close to full employment; the sequester is exactly what the doctor didn’t order.

Read his full column, including his take on Erskine Bowles and Alan Simpson, “the famous fomenters of fiscal fear.”

The arbitrary, across-the-board sequestration cuts in everything from mental health services to public safety kick in next Friday, and House Speaker John Boehner (R-Ohio) and Republican lawmakers say they are willing to toss 750,000 people out of work and cut vital lifeline government services to ring massive concessions in cuts from Social Security, Medicare and Medicaid.

Working families are calling on their elected representatives to protect Social Security, Medicare and Medicaid from benefits cuts, repeal the sequester and make sure corporations and the wealthiest 2% pay their fair share through closing tax loopholes.

This post was originally posted on AFL-CIO on 2/22/2013. Reprinted with Permission.

About the Author: Mike Hall is a former West Virginia newspaper reporter, staff writer for the United Mine Workers Journal and managing editor of the Seafarers Log. He came to the AFL- CIO in 1989 and has written for several federation publications, focusing on legislation and politics, especially grassroots mobilization and workplace safety.

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